1. Cost-volume-profit analysis can't be used if which of the given happens?
a. Per unit variable costs change
b. The total fixed costs change
c. Per unit sales prices change
d. Costs can't be properly classified into fixed and variable costs
2. If ' business had ' capacity of $10,000,000 of sales, actual sales of $6,000,000, break-even sales of $4,500,000, fixed costs of $1,800,000, and variable costs of 60% of sales, determine margin of safety expressed as percentage of sales?
a. 33.3%
b. 18%
c. 25%
d. 15%
3. Amount of income under absorption costing will equal amount of income under variable costing when units manufactured:
a. Are less than units sold
b. Equal units sold
c. Are equal to or greater than units sold
d. Exceed units sold
4. Business operated at 100% of capacity in its first month and incurred following costs:
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Production Costs (20,000 units):
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Direct materials
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$180,000
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|
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Direct labor
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240,000
|
|
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Variable factory overhead
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280,000
|
|
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Fixed factory overhead
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100,000
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$800,000
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|
|
|
|
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Operating expenses:
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|
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Variable operating expenses
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$130,000
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|
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Fixed operating expenses
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50,000
|
180,000
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If 1,600 units remain unsold at end of month, determine the amount of inventory which would be reported on variable costing balance sheet?
a. $56,000
b. $66,400
c. $68,000
d. $64,000
5. If variable selling and administrative expenses totalled $120,000 for year (80,000 units at $1.50 each) and the planned variable selling and administrative expenses totalled $120,900 (78,000 units at $1.55 each), effect of quantity factor on change in variable selling and administrative expenses is:
a. $900 decrease
b. $4,000 decrease
c. $3,100 decrease
d. $3,100 increase